However, in auctions, things can at times change quickly, so one Wall Street observer said Saban shouldn't be completely ruled out of the running yet. Suitors sometimes communicate their take on price expectations to bankers and other parties as part of deal negotiations.

Discovery Communications, Viacom and Scripps Networks along with U.K. industry players last week made initial bids for Channel 5, which has aired such shows as the local version of Big Brother and Dallas. Saban was believed to have also made an initial offer.

One banker said that Saban was from the start seen as unlikely to submit a winning bid on its own and was more likely to join another suitor in a possible team bid as the auction progresses.

Desmond has been targeting a price tag of $1.17 billion (£700 million), with some observers saying the final deal value could come in slightly below that. One banker said Thursday that a Channel 5 sale could still come at a price tag of more than $1 billion (£600 million).

None of the parties in the running have commented on the process.

It wasn't immediately clear when second-round bids for Channel 5 are due, but Broadcast magazine reported Thursday that the process could wrap up within the coming weeks.